The run-up from shipments of around 2.5 million bpd in August comes mainly from condensate, a light oil excluded from OPEC supply quotas that is often produced with natural gas and can be used to make naphtha for petrochemical production.Reuters | October 04, 2016, 17:03 IST

SINGAPORE/BEIJING: Iran's total crude oil and condensate sales likely reached around 2.8 million barrels per day in September, two sources with knowledge of the matter said, nearly matching a 2011 peak in shipments before sanctions were imposed on the OPEC producer.

The run-up from shipments of around 2.5 million bpd in August comes mainly from condensate, a light oil excluded from OPEC supply quotas that is often produced with natural gas and can be used to make naphtha for petrochemical production.

Iran sold 600,000 bpd of condensate for September - up from about 350,000 bpd in August and including about 100,000 bpd shipped from storage - to meet robust demand in Asia, the two sources said. September crude exports increased slightly from the previous month to about 2.2 million bpd, they said.

Iran, along with Libya and Nigeria, is allowed to produce "at maximum levels that make sense" as part of any output limits in a surprise deal reached last week by the Organization of the Petroleum Exporting Countries (OPEC).

Still, the Middle Eastern producer has surprised the market by ramping up its oil output faster than expected, to 3.63 million bpd in August, according to OPEC, up a quarter from end-2015 since sanctions were lifted in January.

"Iran cannot produce much more than the present, so around 3.7 million bpd may be the max," said Fereidun Fesharaki, chairman of consultancy FGE.

Even if Iran's output hit 3.8 million bpd - as an oil official said it had in September - it would not be able to sustain that volume as decline rates at its oilfields are about 400,000 bpd each year, Fesharaki said.

National Iranian Oil Co (NIOC) officials did not immediately respond to an emailed request for comment.

Iran has said it plans to raise its output to 4 million bpd, although other analysts agreed production has probably peaked for now because investments to pump out more oil are lagging.